Companies Divided by Joy and Sorrow Following Biden's Policies (Comprehensive)

Companies on Alert for Biden's Pledge, Corporate Tax Hike Inevitable Blow
Mixed Impact by Industry: Secondary Batteries Smile, Fossil Fuels Cry

[Asia Economy Reporter Changhwan Lee] As the likelihood of Democratic candidate Joe Biden winning the U.S. presidential election increases, domestic companies are also on high alert. Major companies are closely watching the U.S. election results with tension, as they may need to change their long-term management strategies for the coming years, including next year, depending on the outcome.

According to the industry on the 6th, a common concern among companies currently operating in the U.S. is the increase in corporate tax. This is because Biden has pledged to raise the top corporate tax rate from 21% to 28% and gradually increase the minimum wage.

An executive from a major domestic company said, "If Biden becomes the U.S. president, he will push for a corporate tax increase, so Korean companies, including our company operating in the U.S., are likely to face some negative impacts."

In particular, the industry expects that large Korean companies such as Samsung Electronics, Hyundai Motor, and LG Electronics, which generate significant sales in the U.S. market, could experience considerable profit declines.

While companies see it as impossible to avoid some form of impact, the effects vary by industry. Some sectors clearly stand to benefit from Biden’s pledges, while others face higher risks of damage.

Representative beneficiaries are eco-friendly companies. Biden announced a $2 trillion plan for investment in green energy and infrastructure. He pledged to rejoin the Paris Climate Agreement immediately upon taking office and to push for achieving net-zero carbon emissions by 2050.

Accordingly, companies involved in secondary batteries, hydrogen vehicles, electric vehicles, wind power, and solar power are attracting significant market attention. Especially, Biden’s plan to switch government transportation to electric vehicles and expand 50,000 EV charging stations across the U.S. has raised expectations for the battery-related industry.

Leading Korean companies in the global secondary battery market, such as LG Chem, SK Innovation, and Samsung SDI, are internally very optimistic about the Biden administration’s policies.

Companies related to wind and solar power are also highly hopeful. Biden promised to install 5 million solar panels and 60,000 wind turbines over the next five years. As a result, wind turbine company CS Wind, solar power company Hanwha Solutions, and solar material company OCI have recently seen sharp rises in their stock prices, drawing attention.

The Korea Institute for Industrial Economics & Trade analyzed, "Biden’s expansion of clean energy is the most distinctive policy compared to the Trump administration, which emphasized traditional fossil energy," adding, "There could also be benefits in the battery sector closely linked to eco-friendly energy."

Joe Biden, U.S. Presidential Candidate

As the use of eco-friendly energy increases, traditional energy sectors such as fossil fuels and internal combustion engine companies are concerned about damage. Biden has stated he will eliminate subsidies for fossil fuels. Refining, chemical, and internal combustion engine vehicle companies are worried about the impact.

Seonghyun Hwang, chief researcher at Eugene Investment & Securities, explained, "If Biden is elected, the fossil fuel industry could shrink due to subsidy elimination, increased power generation costs, and stricter regulations."

The semiconductor, IT, and steel sectors have mixed positive and negative aspects. Biden is expected to continue regulations against China, similar to Donald Trump. The ongoing U.S.-China trade conflict may shrink related electronics industries.

Tax increases are also a burden. Biden has announced tax hikes not only for corporations but also for individuals, raising concerns about reduced consumption. On the other hand, there is a possibility of windfall gains due to competitor regulations, such as sanctions on Huawei.

An executive from a major domestic IT company said, "If Biden becomes president, the IT and electronics sectors have mixed positive and negative factors, so we do not expect a significant impact."

This content was produced with the assistance of AI translation services.